Two cases, differing fact patterns and no showing at all of a reasonable excuse.
Right Solution Med. Supply, Inc. v Republic W. Ins. Co., 2018 NY Slip Op 51125(U)(App. Term 2d Dept. 2018)
“In support of its motion, defendant submitted an affidavit by plaintiff’s assignor in which plaintiff’s assignor admitted that the December 21, 2009 accident underlying this no-fault proceeding had been staged, and an order dated April 26, 2013, from the Supreme Court, New York County, in a declaratory judgment action, entered on default, finding that defendant herein had no duty to pay any no-fault benefits to plaintiff herein and its assignor, among others, with respect to this accident. The Civil Court denied defendant’s motion, finding that defendant had failed to establish a reasonable excuse for its failure to proceed at trial.
Defendant’s motion should have been granted, as defendant demonstrated both a reasonable excuse for its failure to proceed at trial and a meritorious defense (see CPLR 5015 [a] ; Eugene Di Lorenzo, Inc. v A.C. Dutton Lbr. Co., 67 NY2d 138, 141 ).”
Clearly, the affidavit of the Assignor was powerful tool in opening the default. I wish the Court was more honest and opened the default upon the residual inherent good cause and interest of justice discretion all trial courts and appellate courts have. That would have been a more honest and better decision.
Allstate Ins. Co. v North Shore Univ. Hosp., 2018 NY Slip Op 05268 (2d Dept. 2018)
(1) “On January 29, 2015, the plaintiff commenced this action pursuant to Insurance Law [*2]§ 5106(c) for a de novo determination of the defendant’s claims for recovery of no-fault benefits. The plaintiff then moved for leave to enter a default judgment because the defendant failed to timely appear or answer the complaint. In an order entered April 21, 2015, the Supreme Court granted the plaintiff’s motion for leave to enter a default judgment. On June 8, 2015, the court entered a default judgment.
In July 2016, the defendant moved pursuant to CPLR 5015(a)(1) to vacate its default, and pursuant to CPLR 2004 and 3012(d) to extend its time to answer the complaint. In an order entered October 19, 2016, the Supreme Court denied the motion, and the defendant appeals”
(2) In July 2016, the defendant moved pursuant to CPLR 5015(a)(1) to vacate its default, and pursuant to CPLR 2004 and 3012(d) to extend its time to answer the complaint. In an order entered October 19, 2016, the Supreme Court denied the motion, and the defendant appeals.
The defendant’s motion was timely made (see CPLR 5015[a]; 2103[b]). A defendant seeking to vacate a default pursuant to CPLR 5015(a)(1) on the ground of excusable default must demonstrate a reasonable excuse for the default and a potentially meritorious defense to the action (see CPLR 5015[a]; Eugene Di Lorenzo, Inc. v A.C. Dutton Lbr. Co., 67 NY2d 138, 141; EMC Mtge. Corp. v Toussaint, 136 AD3d 861, 862; Lane v Smith, 84 AD3d 746, 748). Here, the defendant demonstrated a reasonable excuse for its default and a potentially meritorious defense to the action
When I see 5015(a)(1) and 2103(b)(2) together, I am sensing that the one year period to vacate ran from when the order was mailed on arbitration counsel. I just cannot tell from this decision, but it definitely opens up the door to vacturs of trial de novo defaults with the presentment of the right facts.
Hertz Vehicles, LLC v Best Touch PT, P.C.,2018 NY Slip Op 04854 (1st Dept. 2018)
(1) “Plaintiff failed to meet its burden of filing “proof of the facts constituting the claim” for a default declaratory judgment (CPLR 3215[f]) against the medical provider defendants, i.e., proof establishing that the notices of examination under oath (EUO) that it served on those defendants complied with the timeliness requirements of 11 NYCRR 65-3.5(b) (see Kemper Independence Ins. Co. v Adelaida Physical Therapy, P.C., 147 AD3d 437 [1st Dept 2017]; Natl. Liab. & Fire Ins. Co. v Tam Med. Supply Corp., 131 AD3d 851 [1st Dept 2015]). An insurer must request any “additional verification . . . to establish proof of claim” within 15 business days after receiving the “prescribed verification forms” it forwarded to the parties required to complete them (11 NYCRR 65-3.5[a], [b]). As none of the motion papers, including the affidavit by plaintiff’s claims adjuster, annexes or gives the dates of the prescribed verification forms or other proofs of claim submitted by the medical provider defendants, it is not possible to determine whether the EUO notices were sent to them within 15 business days of plaintiff’s receipt of the form”
What was interesting is in the last appeal of a lost DJ, the Court appeared to walk around 65-3.5 and 65-3.6 when the issue involved a default. The rationale could be found in the dissent of Longevity and sub silentio set forth in the majority opinion in the same. This case now applies the summary judgment standard to defaults.
(2) “Plaintiff’s argument on appeal that the providers’ bills are “prescribed verification forms” and its attempt to relate the deadlines applicable to one defendant’s EUO requests to another defendant’s submission of claims documentation or appearance for an EUO are unpreserved and, in any event, unsupported.”
Certain defense attorneys have tried to use the bootstrap method to establish timeliness. I never bought it.
(3) “The court erred in denying plaintiff’s motion for a default judgment against Bellevue on the ground that the motion did not contain any letter reflecting that Bellevue’s EUO transcript was sent to her for signature. The motion does contain such a letter, dated March 14, 2016, as well as a follow-up letter, dated April 20, 2016, and accompanying affidavits of service. As the [*2]failure to submit to an EUO and “subscribe the same” violates a condition precedent to coverage (see 11 NYCRR 65-2.4[c]), plaintiff provided adequate proof of its claims against Bellevue (see DTG Operations, Inc. v Park Radiology, P.C., 2011 NY Slip Op. 32467[U], *5-6 [Sup Ct, NY County 2011]”
This should worry anyone because I highly doubt that DFS (absent a Thrasher showing) ever advocated for a voiding of the policy due to the failure to sign a transcript. I see a circular letter coming on this issue, similar to when DFS issued a circular letter to overturn Soundshore.
Global Liberty Ins. Co. v New Century Acupuncture, P.C., 2018 NY Slip Op 03444 (1st Dept. 2018)
“Plaintiff sent an initial IME scheduling letter, and a re-scheduling letter, to both Davis and her attorney. After Davis failed to appear for the re-scheduled IME, plaintiff sent a third letter to the attorney, which indicated on its face that a copy had been sent to Davis. However, it is undisputed that the letter to Davis was sent to the wrong address. Thus, there was no reason for the attorney to know that Davis had not received notice of the re-scheduled IME and to tell her of the new IME date and location. Under these circumstances, the motion court properly found that plaintiff failed to demonstrate that it provided adequate notice, reasonably calculated to apprise Davis that her appearance at an IME at a specified date and location was required”
Hereford Ins. Co. v Lida’s Med. Supply, Inc., 2018 NY Slip Op 03226 (1st Dept. 2018)
(1) “While plaintiff’s notice of motion did not specify that it was solely moving for summary judgment on its first cause of action, its attorney’s affirmation shows that they were limiting the relief sought to this claim.” (if this is a volume business a pro-forma motion, then why not have a software system that indicates this)
(2) “When an individual submits a personal injury claim for motor vehicle no-fault benefits, the insurance company may request that the individual submit to an IME, and if the individual fails to appear for that IME, it “constitutes a breach of a condition precedent vitiating coverage””
(3) “Here, plaintiff established its entitlement to judgment as a matter of law by submitting the letters sent to each claimant notifying them about the date, time, and location of the initially scheduled IME and a second scheduled IME and affidavits of service for these letters. Plaintiff also submitted affidavits from each medical professional assigned to conduct the scheduled IME, with each stating that the medical professional was in his or her office at the date and time of the scheduled IME, the respective claimant failed to appear, the appointment was kept open until the end of the day, and at the end of the day, the medical professional filled out the affidavit acknowledging the nonappearance.”
(4)”Because Hereford sent the notices scheduling the IMEs prior to the receipt of each of the claims, the notification requirements for verification requests under 11 NYCRR 65-3.5 and 65-3.6 do not apply (see Mapfre at 469). Furthermore, plaintiff was not required “to demonstrate [*2]that the claims were timely disclaimed since the failure to attend medical exams was an absolute coverage defense” (American Tr. Ins. Co. v Lucas, 111 AD3d 423, 424-25 [1st Dept 2013]]).”
Two things to take from this.
First, the All of NY case was limited to a provider EUO no show DJ predicated upon a record missing demonstrative evidence. In contrast, this was the boilerplate IME no-show DJ. The result makes sense and is consistent with prior precedent.
Second, I think the proof of the no-show here is a lot less than the line of cases that the Appellate Term, First Department created. But this would make sense when you look at how these panel judges when all of them sat in no-fault land (Civil and Supreme Court DJ parts).
Active Care Med. Supply Corp. v Amica Mut. Ins. Co., 2018 NY Slip Op 50500(U)(App. Term 2d Dept. 2018)
The man who wrote the book glossed over the discussion of Magic Recovery in seeking to backdoor summary judgment win. Sneaky.
“However, plaintiff herein was neither named nor served in the Supreme Court declaratory judgment action. Moreover, plaintiff was not in privity with the injured party, as the assignment of benefits had been executed before defendant commenced the declaratory judgment action. Thus, plaintiff had no full and fair opportunity to defend its interests in that action”
Active Chiropractic, P.C. v 21st Century Ins. Co., 2018 NY Slip Op 50200(U)(App. Term 2d Dept. 2018)
Many times the Court will write motion granted settled order, or include certain facts without “adjudging” or “declaring” the rights of the parts.
This case signifies the importance to obtain a signed and entered judgment setting forth the declarations to which you believe you are entitled when the occasion arises. The defaulting defendant’s remedy is to open the DJ.
“With respect to defendant’s cross motion, as the December 8, 2014 Supreme Court order in the declaratory judgment action merely granted the branch of defendant’s motion for the entry of a default judgment against plaintiff and its assignor, but failed to make a statement declaring the rights of the parties involved (see Hirsch v Lindor Realty Corp., 63 NY2d 878, 881 ; Suburban Bindery Equip. Corp. v Boston Old Colony Ins. Co., 150 AD2d 767 ; Metro Health Prods., Inc. v Nationwide Ins., 48 Misc 3d 85 [App Term, 2d Dept, 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 action at bar”
The prologue here is that a judgment was eventually signed.
Active Chiropractic, P.C. v Allstate Ins., 2018 NY Slip Op 50201(U)(App. Term 2d Dept. 2018)
“Initially, we note that, although defendant’s motion was denominated as one to dismiss the complaint pursuant to CPLR 3211 (a) (5), the motion was made after issue had been joined (see generally CPLR 3211 [e]). “Whether or not issue has been joined, the court, after adequate notice to the parties, may treat the motion as a motion for summary judgment” (CPLR 3211 [c]). While the Civil Court never notified the parties that it was treating the motion as one for summary judgment, an exception to the notice requirement is applicable, as defendant’s motion exclusively involved “a purely legal question rather than any issues of fact” (Mihlovan v Grozavu, 72 NY2d 506, 508 ; Four Seasons Hotels v Vinnik, 127 AD2d 310, 320 ; Renelique v State-Wide Ins. Co., 50 Misc 3d 137[A], 2016 NY Slip Op 50095[U] [App Term, 2d Dept, 2d, 11th & 13th Jud Dists 2016]). Consequently, it was proper for the Civil Court, in effect, to 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).”
Upon finding the motion properly brought and timely, judgment on the unpleaded affirmative defense was granted.
Unitrin Advantage Ins. Co. v All of NY, Inc., 2018 NY Slip Op 00810 (1st Dept. 2018)
In the approximately 10 years, since Unitrin brought the notion of the condition precedent DJ. And now, 9 years later, it has almost been destroyed on a less than stellar record. You should read the record and then look at the oral argument (nobody asked a question except to point certain documentation was missing and it continued with the apology that it was a long day).
“Although the failure of a person eligible for no-fault benefits to appear for a properly noticed EUO constitutes a breach of a condition precedent, vitiating coverage, Unitrin was still required to provide sufficient evidence to enable the court to determine whether the notices it served on Dr. Dowd for the EUOs satisfied to the timeliness requirements of 11 NYCRR 65—3.5(b) and 11 NYCRR 65—3.6(b) (see Kemper Independence Ins. Co. v Adelaida Physical Therapy, P.C., 147 AD3d 437, 438 [1st Dept 2017], citing Mapfre Ins. Co. of N.Y. v Manoo, 140 AD3d 468, 470 [1st Dept 2016]). The bills for the first and second dates of medical services, May 15, 2013, and May 22, 2013, were both received by Unitrin on June 17, 2013. In accordance with 11 NYCRR 65-3.5(b), Unitrin had 15 business days to request the EUO, or by July 1, 2013. Unitrin’s July 15, 2013 scheduling letter, even if properly mailed, was not timely as to either date of service.”
Two problems here. First this was a provider EUO. The record discloses, establishes and discuss the fact that the patient EUO gave cause (allegedly) for the provider EUOs. Yet, no discussion of that timeline was set forth in the motion (see Quality v. Utica – allowing the tolling of a provider EUO based upon a prior patient EUO). I don’t get it. the EUO process started before the received billing. Had this been discussed, the 3.5(b) issue would be non-existent and I think the case would have been affirmed.
Also, did counsel discuss the one day off the back for each day between 15 business days and 30-calendar days? I sense that discussion did not occur.
Now, a bad global denial is fatal? ” The second examination date, August 12, 2013, is not mentioned, and therefore did not sufficiently apprise the provider as to the reason for denial (see Nyack Hosp. v State Farm Mut. Auto. Ins. Co., 11 AD3d 664, 664-665 [2d Dept 2004]).”
It is like anything else – some cases need to settle. This was one of them – watch the argument and you will see what I mean. Luckily, Manoo settled or the First Department DJ as we know it would probably be dead. That was a complete disaster in motion.
I think Defendant is entitled to attorney’s fees if the EIP was a driver or insured.
Many issues here will await another fully contested appeal.
Hertz Vehs. LLC v Significant Care, PT, P.C., 2018 NY Slip Op 00456 (1st Dept. 2018)
The affidavit of the Hertz claims handler personally assigned to this claim, as corroborated by the NF-10 denial of claim form (Wausau Bus. Ins. Co. v 3280 Broadway Realty Co. LLC, 47 AD3d 549, 549 [1st Dept 2008]; see also American Tr. Ins. Co. v Longevity Med. Supply, Inc., 131 AD3d 841, 842 [1st Dept 2015]), stated that the date Pavlova’s bill was received by the insurer was July 18, 2014. Hertz therefore established its compliance with 11 NYCRR 65-3.5(b) by generating the first EUO scheduling letter within 15 days of receipt of the provider’s bill, and compliance with 11 NYCRR 65-3.6(b), by generating the second EUO scheduling letter less than 10 days after the first nonappearance on August 7, 2014.
Hertz also established proof of mailing because it included an affidavit of service, which was executed by the person who mailed the EUO notices and who attested that each was mailed by regular mail to the address provided on the claimant’s claim form, as well as to claimant’s attorney, in a “postpaid, properly addressed wrapper, in an official depository under the exclusive care and custody of the United States Postal Service within the State of New York” (see American Tr. Ins. Co. v Lucas, 111 AD3d 423, 424 [1st Dept 2013]; see also Deluca v Smith, 146 AD3d 732, 732 [1st Dept 2017]).
Pavlova’s argument, raised for the first time on appeal, that the second EUO nonappearance date was not a non-appearance because the claimant’s counsel was present, and because there was a statement on the record which not only acknowledged claimant’s nonappearance, but also agreed to reschedule the EUO, is unpreserved and unavailing.
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]), 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 ).”
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 ). 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.