No coverage due to lack of proof regarding Claimant's status as resident relative

Rally Chiropractic, P.C. v Nationwide Mut. Ins. Co., 2012 NY Slip Op 50417(U)(App. Term 2d Dept. 2012)

Defendant proved that the Assignor did not “regularly reside” with the insured thus there was no coverage from Nationwide.  The opinion is less than clear if there were any other sources of no-fault coverage in this case.  However, since there is also a 45-day issue, I have to guess that there were issues determining where coverage existed, if it all.

“The proof submitted by both defendant and plaintiff established that plaintiff’s assignor was not an eligible injured person under the policy in issue (Insurance Department Regulations [11 NYCRR] § 65-1.1 [d]) since she did not “regularly reside[]” with the insured at the time of the accident (Insurance Department Regulations [11 NYCRR] § 65-1.1 [g]). Defendant further established that it had timely denied plaintiff’s claim (see St. Vincent’s Hosp. of Richmond v Government Empls. Ins. Co., 50 AD3d 1123 [2008]; Delta Diagnostic Radiology, P.C. v Chubb Group of Ins., 17 Misc 3d 16 [App Term, 2d & 11th Jud Dists 2007]) on this ground. In any [*2]event, even if defendant’s denial of claim form had been defective or untimely, the defense of lack of coverage is not subject to preclusion (Psychology & Massage Therapy Assoc., PLLC v Progressive Cas. Ins. Co., 12 Misc 3d 140[A], 2006 NY Slip Op 51351[U] [App Term, 2d & 11th Jud Dists 2006]; see Central Gen. Hosp. v Chubb Group of Ins. Cos., 90 NY2d 195, 201 [1997]).”

(45-day rule issues also discussed)

MVAIC continues to dig its grave at the Appellate Division

Motor Veh. Acc. Indem. Corp. v NYC East-West Acupuncture, P.C., 2010 NY Slip Op 07111 (1st Dept. 2010)

Sometimes, you win the battle but lose the war.  The best instance of that paradox in no-fault practice involved the Appellate Division’s holding in Matter of MVAIC v Interboro Med. Care & Diagnostic PC, 73 AD3d 667 (1st Dept. 2010), when that Court, after handing MVAIC a victory,  stated the following: “We would add that the burden is on MVAIC to prove its lack-of-coverage defense.”

Then came Socrates Med. Health, P.C. v Motor Veh. Acc. Indem. Corp., 28 Misc 3d 141(A)(App. Term 1st Dept. 2010), where the Appellate Term, First Department, held the following: “In opposition, defendant, which bore the burden of proving its lack of coverage defense, failed to raise a triable issue on this point, since it offered no competent evidence showing that the plaintiff’s assignor’s loss arose from the use or operation of an uninsured motor vehicle”.

Now, the saga continues with Motor Veh. Acc. Indem. Corp. v NYC East-West Acupuncture, P.C.2010 NY Slip Op 07111 (1st Dept. 2010), where MVAIC was trying to prove a lack of coverage through averring that the Assignor resided in a household where Allstate provided coverage.  Procedurally, MVAIC sought to adjourn the case in order to provide this evidence.  The adjournment was denied and an award in Respondent’s favor was granted.

A common theme through all of these cases is that MVAIC is trying to get around certain claims handling issues through asserting the special “coverage defense” it has that no other insurance carrier enjoys.  Why MVAIC does not consistently clear up these coverage issues through seeking timely verification requests is beyond me.  Also, why doesn’t MVAIC submit certified insurance expansion reports?

In my opinion, it appears to me that the courts, especially in the First Department, are sending a message to MVAIC that they need to play by the rules that the rest of us on the defense bar are forced to abide by.

Was she a resident relative?

When looking for a secondary source of coverage (or primary in New Jersey and Florida), the question that must be answered is whether the injured person is a resident relative of a policyholder.  The latter of the two words “relative” is easy to define.  It is the term “resident” that has caused much uncertainty through the years.  Each query involving who is a resident is factually specific, similar to whether someone is within the “use and operation” of a motor vehicle.  The Matter of State Farm Mut. Auto. Ins. Co. v Bonifacio, 2010 NY Slip Op 00523 (2d Dept. 2010) proves not to be any different as seen herein:

“At the framed-issue hearing, the respondent testified that she lived most of her life at her parents’ residence in Yorktown Heights until she graduated from college in 2005. Shortly thereafter, in September of that year, she rented an apartment in Manhattan with two other people. Two months later, the respondent began employment in Manhattan where she worked five days a week, 11 to 12 hours a day. More than two years later, the respondent, after spending a Sunday afternoon with some friends near her hometown, was struck by a car while crossing Route 9A in Ardsley.

Although the respondent testified at the hearing that she visited her parents at the Yorktown residence at least once a month, “most often more,” and that her parents maintained a room for her there where she kept some of her personal belongings, the respondent was emancipated from her parents, paid rent at the Manhattan residence, filed her own tax returns, and was no longer a dependent on her parents’ [*2]tax returns. Evidence that the respondent’s driver’s license still listed her parents’ address as her home address, that she possessed a key to her parents’ home and, in 2008, voted in Yorktown Heights, and that she previously opened a bank account at a Chase branch in Yorktown Heights, was insufficient to establish that the respondent was residing at the Yorktown residence of her parents at the time of the accident (see Matter of Aetna Cas. & Sur. Co. v Gutstein, 80 NY2d 773; Matter of Aetna Cas. & Sur. Co. v Panetta, 202 AD2d 662; D’Amico v Pennsylvania Millers Mut. Ins. Co., 72 AD2d 783, affd 52 NY2d 1000; cf. Dutkanych v United States Fid. & Guar. Co., 252 AD2d 537). Moreover, physical presence in the parents’ home was insufficient to establish residency, particularly where, as here, the respondent had previously established another legal residence in Manhattan and signed a new one-year lease at that residence only two months before the accident (see Hollander v Nationwide Mut. Ins. Co., 60 AD2d 380, 383; Appleton v Merchants Mut. Ins. Co., 16 AD2d 361; Allstate Ins. Co. v Jahrling, 16 AD2d 501).

Based on the evidence presented, the respondent was not a covered person under the subject policy and, therefore, the petition to permanently stay the arbitration should have been granted.”