Some newer cases

Recent Procedural Developments in New York No-Fault Insurance Law

The no-fault insurance litigation landscape in New York and New Jersey continues to evolve through a series of important procedural decisions. While major substantive changes may be rare, procedural developments can significantly impact how cases are litigated, discovered, and resolved. These recent decisions from 2008 provide crucial guidance for practitioners throughout the New York metropolitan area, particularly those handling cases in Nassau, Suffolk, Queens, and Brooklyn counties.

The Original Analysis: Key Procedural Developments

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 ; Iseman v Delmar Med.-Dental Bldg., 113 AD2d 276 ; JMJ Contract Mgt. v Ingersoll-Rand Co., 100 AD2d 291, 293 ).

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)

Understanding the Broader Implications for New York Practitioners

While these cases may seem like routine procedural matters, they collectively represent significant developments in how no-fault insurance litigation is conducted throughout New York State. For practitioners in Long Island’s Nassau and Suffolk counties, as well as New York City’s outer boroughs, these decisions provide crucial guidance on discovery practice, motion strategy, and case management.

The Strategic Importance of “Quiet” Periods

As noted in the original analysis, periods of relative quiet in appellate decision-making often precede more significant substantive developments. These procedural refinements lay the groundwork for how future substantive issues will be litigated and decided.

Deep Dive: Res Judicata and Stipulated Discontinuances

The Support Billing & Mgt. Co. decision addresses a critical issue that frequently arises in no-fault practice: the preclusive effect of stipulated discontinuances marked “with prejudice.”

Practical Implications

For medical providers and their attorneys throughout the New York metropolitan area, this ruling means that settling cases through stipulated discontinuance requires careful consideration of the language used. A discontinuance “with prejudice” creates a presumption of res judicata effect, potentially barring future litigation on the same claim.

Strategic Considerations

• Settlement Negotiations: Consider whether a discontinuance with prejudice truly serves the client’s interests, especially where ongoing billing disputes may arise
• Documentation: Ensure settlement agreements clearly define what claims are being resolved and what future claims, if any, are preserved
• Client Counseling: Advise clients about the potential preclusive effect of different settlement structures

Discovery Practice: The Precluded Defense Doctrine

The Corona Heights Medical decision provides important guidance on a common discovery dispute in no-fault litigation: when defendants seek discovery relating to defenses they’ve been precluded from raising.

The Timely Denial Requirement

New York’s no-fault system requires insurance companies to promptly deny claims they believe lack merit. Failure to provide timely denial precludes many defenses, including lack of medical necessity. This case clarifies that “timely” means more than merely facially timely—it must be substantively proper as well.

Practical Guidance for Insurance Defense

For insurance defense attorneys practicing in Nassau, Suffolk, and the five boroughs, this decision emphasizes the importance of:

• Early Case Evaluation: Thoroughly review all claims promptly upon receipt
• Proper Denial Procedures: Ensure all denials comply with both timing and substantive requirements
• Discovery Strategy: Avoid seeking discovery that relates to precluded defenses
• Motion Practice: Challenge palpably improper discovery demands rather than simply responding

Balancing Multiple Discovery Devices

The First Aid Occupational Therapy decision addresses the intersection of different discovery tools in no-fault litigation, particularly the relationship between document demands and examination before trial (EBT) requests.

The Rule Against Simultaneous Discovery

While courts generally discourage serving multiple discovery devices simultaneously, this case confirms that defendants can conduct EBTs even when they’ve also served document demands, provided both are justified and not overly burdensome.

Best Practices for Discovery Management

• Sequential Discovery: Consider staging discovery requests to avoid appearance of overreach
• Coordination: Ensure different discovery tools complement rather than duplicate each other
• Justification: Be prepared to articulate why multiple discovery devices are necessary
• Proportionality: Balance discovery needs against case value and complexity

Extraterritorial Subpoenas: The CCA 1201 Standard

The reference to Bronxborough Medical highlights an ongoing issue in New York practice: when courts will allow subpoenas to be served outside their territorial jurisdiction under CPLR 2303.

The “Good Reason” Standard

Courts require practitioners to demonstrate good reason for extraterritorial subpoenas. This typically involves showing that:

• The information sought is material to the case
• The information cannot be obtained through other means
• The burden of compliance is reasonable given the case’s circumstances
• The subpoena serves the interests of justice

Implications for Long Island and NYC Practice

These procedural developments have particular significance for practitioners in the greater New York area:

Cross-Jurisdictional Practice

Many no-fault cases involve parties, witnesses, and evidence located across multiple counties. Understanding when extraterritorial subpoenas are appropriate becomes crucial for effective case development.

High-Volume Practice Management

No-fault litigation often involves high case volumes with relatively modest individual values. These procedural refinements help practitioners manage cases more efficiently while avoiding costly missteps.

Frequently Asked Questions

What makes a discontinuance “with prejudice” versus “without prejudice”?

The specific language of the stipulation controls. A discontinuance “with prejudice” creates a presumption of res judicata effect, meaning the same claim generally cannot be relitigated. Without prejudice typically preserves the right to bring the claim again.

How can insurance companies avoid having their defenses precluded?

Ensure all claim denials are both timely and substantively proper. This means reviewing claims promptly, providing detailed reasons for denial, and complying with all regulatory requirements for denial notices.

Can I serve document requests and schedule depositions at the same time?

While possible, it’s generally better practice to sequence discovery logically. Document review often informs more effective deposition questioning. However, where both are justified, courts may allow simultaneous discovery.

What constitutes “good reason” for an extraterritorial subpoena?

Courts consider factors like the materiality of the evidence, availability through other means, burden of compliance, and overall interests of justice. Each case is evaluated on its specific circumstances.

How do these procedural rules affect case settlement values?

Procedural advantages or disadvantages can significantly impact settlement negotiations. A properly preserved defense or successful discovery ruling can strengthen negotiating positions considerably.

Strategic Implications for Different Practice Areas

For Medical Provider Counsel

• Settlement Strategy: Carefully consider the res judicata implications of different discontinuance language
• Discovery Defense: Object to palpably improper discovery rather than simply complying
• Case Management: Use procedural rules strategically to streamline case resolution

For Insurance Defense Counsel

• Early Preservation: Ensure all defenses are properly preserved through timely, substantive denials
• Discovery Planning: Coordinate multiple discovery tools effectively while avoiding overreach
• Motion Practice: Use procedural advantages to resolve cases efficiently

The Evolution of No-Fault Procedure

These cases illustrate how no-fault insurance litigation continues to evolve through judicial interpretation of existing procedural rules. While the substantive law may remain relatively stable, procedural developments can significantly impact case outcomes and litigation strategy.

Staying Current with Developments

Effective no-fault practice requires staying current with procedural developments across multiple courts and jurisdictions. What appears to be a “quiet” period may actually represent important foundational work for future substantive developments.

Professional Guidance for Complex Procedural Issues

Navigating the procedural complexities of New York’s no-fault insurance system requires experienced counsel who understands both the established rules and their evolving interpretation through case law. Whether you’re dealing with discovery disputes, settlement negotiations, or motion practice, professional legal guidance is essential.

These seemingly minor procedural developments can have major impacts on case outcomes and client interests. Don’t let procedural missteps undermine otherwise strong cases.

Call 516-750-0595 to discuss your no-fault insurance matter with an experienced attorney who stays current with procedural developments and can help you navigate the complex landscape of New York insurance litigation effectively.

Related Articles

• Understanding Collateral Estoppel in No-Fault Arbitrations: Critical Insights for New York Insurance Claims
• Discovery Violations and Court Sanctions: When New York Courts Strike Back
• Civil Procedure Pitfalls: The High Cost of Improper Note of Issue Filing in New York
• Understanding the Lobel Effect: No-Fault Insurance and Personal Injury Law
• New York No-Fault Insurance Law

---

Legal Update (February 2026): Since this 2008 analysis, New York’s no-fault insurance procedural landscape has undergone numerous changes, including amendments to CPLR discovery provisions, updates to Appellate Term practice standards, and evolving case law on res judicata applications in insurance contexts. Practitioners should verify current CPLR 2303 requirements and review recent Appellate Division decisions regarding discovery sanctions and collateral estoppel principles, as procedural standards and judicial interpretations have continued to develop over the past seventeen years.