The declaratory action was properly stated

High Definition MRI, P.C. v Liberty Mut. Holding Co., Inc., 2017 NY Slip Op 01799 (1st Dept. 2017)

“Contrary to the motion court’s conclusion, the breach of contract action against defendants Liberty Mutual Holding Company, Inc., Liberty Mutual Insurance Company, Safeco Insurance Company of America, Inc., and Indiana Insurance Company provides adequate notice of the transactions and occurrences intended to be proved (see CPLR 3013), and the cause of action for a declaration that defendants’ claim-handling processes are unlawful and that plaintiff is properly incorporated states a cause of action for declaratory relief (see State Farm Mut. Auto. Ins. Co. v Anikeyeva, 89 AD3d 1009, 1010 [2d Dept 2011]).”

The discovery on this case is going to absolutely brutal, and I sense a settlement is coming

The motion that went nowhere

Genovese v State Farm Mut. Auto. Ins. Co., 2013 NY Slip Op 03453 (App. Term 2d Dept. 2013)

“The complaint alleged, among other things, that the plaintiff entered into an insurance contract for State Farm to provide the plaintiff with no-fault insurance benefits if he was involved in a car accident, and that State Farm breached the contract by denying coverage for medical services. Since the allegations in the complaint were sufficient to state a breach of contract cause of action, the Supreme Court should have denied that branch of State Farm’s motion which was pursuant to CPLR 3211(a)(7) to dismiss the first cause of action.

The Supreme Court properly granted that branch of State Farm’s motion which was pursuant to CPLR 3211(a)(7) to dismiss the second cause of action, which sought consequential damages for breach of the no-fault insurance benefits policy. The plaintiff’s prolix allegations, when “[s]tripped of their verbiage” (United States Fid. & Guar. Co. v Pressler, 77 NY2d 921, 923), do not adequately plead facts that would support a finding that his damages for pain and suffering arose out of State Farm’s alleged breach of its obligations under its no-fault insurance contract with him (see id. at 923).

This was Mr. Zuppa’s case.  I omitted the fact that his fraud causes of action were booted.  I think the 3211(a)(7) portion and the fact that the court was unhappy with his prolix allegations was enough to post.  Admittedly, I had to google the word prolix – I never encountered it before in my 30+ years on this earth.  That word in the history of the published decisions in New York has been used 167 times.  Not a lot when you consider that our courts probably generate over 10,000 opinions a year.  Incidentally, the last time the Second Department used the prolix was in 2007 (Data Tree, LLC v. Romaine, 36 A.D.3d 804, 828 N.Y.S.2d 512, 2007 N.Y. Slip Op. 00526, N.Y.A.D. 2 Dept., January 23, 2007 (NO. 2005-06121, 19331/04).

Knowing the Plaintiff, the complaint read like a novel.

While delay was lengthy, the lack of prejudice excused it

Ava Acupuncture, P.C. v GEICO Gen. Ins. Co., 2012 NY Slip Op 50234(U)(App. Term 2d Dept. 2012)

“In this case, while the delay was lengthy, plaintiff does not deny that discovery and trial postponements intervened to delay the action and for reasons unrelated to the motion’s merits. Since the defenses address the effect of contractual terms on recovery and since plaintiff does not deny defendant’s claim that its NF-10 forms invoked a deductible, the claim of surprise or prejudice so great as to warrant the motion’s denial is not established.”

“Since plaintiff as assignee stands in the shoes of the insured, plaintiff cannot claim ignorance of the terms of the very contract under which it alleges entitlement to no-fault benefits compensation”

Service on a TPA is not valid service after all

Omni Med. Servs., P.C. v Arch Ins., 2011 NY Slip Op 51411(U)(App. Term 2d Dept. 2011)

Service upon the TPA is fatal in obtaining jurisdiction over an insurance carrier.  I think there is Appellate Division case law that could be found on the CPLR blog that refutes this proposition of law.

“Here, the process server served the summons and complaint upon a clerk employed by defendant’s third-party claims administrator, and the record is devoid of any showing that he was an officer, director, managing agent, cashier, or an agent authorized by appointment to accept service on defendant’s behalf”

So what happens when you admit an allegation in an answer you should never have been admitted?

Anoun v City of New York, 2011 NY Slip Op 05638 (1st Dept. 2011)

Deny, Deny, Deny and do not withdraw those affirmative defenses.  Well, only when answering a complaint.

But, despite everything I always thought, you can get around an admission in a complaint through a motion for leave to amend.

“defendant answered and admitted ownership and control over the area where the accident occurred.”  WOOPS

“Defendant subsequently moved for, inter alia, summary judgment, arguing that it did not own the subject park. Defendant provided evidence that the property was owned by the State. When defendant realized that it had previously admitted ownership, defendant moved for leave to serve an amended answer and to stay a determination of the summary judgment motion.”

It is well established that leave to amend a pleading is freely given “absent prejudice or surprise resulting directly from the delay” (Fahey v County of Ontario, 44 NY2d 934, 935 [1978]; see CPLR 3025[b]). “Prejudice arises when a party incurs a change in position, or is hindered in the preparation of its case, or has been prevented from taking some measure in support of its position” (Valdes v Marbrose Realty, 289 AD2d 28, 29 [2001]). Here, the 90-day period within which plaintiff could serve the State with a notice of claim terminated on September 29, 2008, more than three months prior to defendant’s admission of ownership. Thus, the admission could not have caused plaintiff any prejudice. For the same reasons, plaintiff’s claims of estoppel are unfounded (see Baje Realty Corp. v Cutler, 32 AD3d 307, 310 [2006]).

Although it may ultimately be found that defendant participates in the park’s operation or retains some control over it, that does not warrant denial of the motion to amend. On such a motion, the court considers “the sufficiency of the merits of the proposed amendment” (Heller v Louis Provenzano, Inc., 303 AD2d 20, 25 [2003] [internal quotation marks and citation omitted]). Here, defendant’s submissions, which included an affidavit of the title examiner and *2 appropriation maps showing that the property was the subject of a taking by the State, were sufficient to support the proposed amendment (see e.g. MBIA Ins. Corp. v Greystone & Co., Inc., 74 AD3d 499 [2010]).”

So here you go.

The failings of the former serve and file system – again

Globe Med. Care O.L.P.C. v Travelers Ins. Co., 2010 NY Slip Op 50020(U)(App. Term 1st Dept. 2010)

“Civil Court erred in dismissing this action by plaintiff to recover first-party no-fault benefits at the close of the trial on the ground that plaintiff failed to file proof of service of the summons and complaint on defendant. At no point in the action did defendant assert that plaintiff failed to file an affidavit of service and, therefore, defendant waived any objection on that ground (see generally Ballard v HSBC Bank USA, 6 NY3d 658 [2006]; Harris v Niagara Falls Bd. of Educ., 6 NY3d 155 [2006]). In any event, the failure to file an affidavit of service under the former commencement-by-service system that governed when this action was commenced (see former CCA 409) did not warrant dismissal of the action; rather, such failure was an irregularity that was correctable nunc pro tunc (see former CCA 411)….”

As a practitioner who started off in this practice during the  serve and file era, I would say that Travelers’ position in this matter was reasonable.  To explain, one of the tactics that Plaintiffs used in the serve and file era was to serve the carriers with summons and complaints, but never actually purchase an index number.  I was told that the purpose of this was to induce settlements and save everyone the fee of purchasing an index number.   The problem with tracking these cases is that you never knew if an index number was purchased until Plaintiff informed the defendant of the same.  You also could not call the court because title and name searches do not usually work in the realm of no-fault.  The only thing many defendants could do would be to wait to see if an index number somehow appeared.

What would many times happen is that about one year after the complaint was served, an index number magically appeared.  The amazing thing is that it seemed that plaintiffs were exempt from seeking nunc pro tunc relief on notice; rather, the clerks allowed the belated purchasing of index numbers.

The net effect of this was that files, which were closed and boxed up, had to be dragged from storage and reopened.  Reserves that were liquidated had to be set up again.  The whole system was the definition of chaos.

So it is against this backdrop from which one should evaluate this case.  I therefore think that Travelers’ position to dismiss the case based upon the failure to provide a timely affidavit of service or a prior application for nunc pro tunc relief was not unreasonable.  I think Justice Golia in J.R. Dugo, D.C., P.C. v. New York Cent. Mut. Ins. Co., 24 Misc.3d 68 (App. Term 2d Dept. 2009) made a really good argument in his dissent, which ties into my post.

Plead it or lose

What happens is that once a month, the Fourth Department will slam the Most Recent Decision website with about 100 cases.  As a practitioner, blogger and a never ending appellate writer, it is always important to know what new and relevant cases are out there.  With that introduction, I will say that there were only a few worthwhile Fourth Department cases that deal tangentially with our area of practice.

Weaver v Town of Penfield was just a run of the mill Ins Law 5102(d) threshold case.  But, Plaintiff’s counsel did not check his paralegal’s work and might have cost his client a viable claim.  To quote the pertinent portion of the decision: “Although the record contains some objective evidence of an injury to plaintiff’s cervical spine, we note that the complaint, as amplified by the bill of particulars and supplemental bill of particulars, does not allege that plaintiff sustained a serious injury to his cervical spine as a result of the accident.”  A lesson to us all – check what goes out the door.